Cryptocurrencies have long been plagued by fake trading volumes. Once these fake volumes have been removed, the real trading volume often makes for surprising results.
Ripple, the third largest cryptocurrency with a $13.7 billion market cap, boasts a 24-hour trading volume of $1.2 billion at the time of writing. However, according to data from OpenMarketCap, a platform that aggregates data from exchanges that don’t allow shady practices, XRP’s turnover is just $81.7 million. That’s a worryingly low figure, suggesting as much as 93% of Ripple’s reported volume is fake.
Ripple isn’t the only coin suffering from fake volumes. Litecoin, for example, has $106 million real volume as opposed to the $2.9 billion. Additionally, EOS has $121 million versus the $2.9 billion, and Bitcoin Cash’s real volume is $146 million compared to the reported $1.6 billion.
Bitcoin has one of the worst, however, who’s trading volume surges to 48% from 29% when removing the suspicious data.
As CCN reports, OpenmarketCap is a product of DIRT protocol founded by Yin Wu. During a blog post, Wu explained why so many exchanges report fake volumes to deceive their users:
“Exchanges are incentivized to report false numbers to climb price tracker listings (and thus be featured more prominently to users).”
OpenMarketCap is a new crypto tracker that calculates price and volume using data from the 10 trusted exchanges on the @BitwiseInvest report.
A 95% drop in trading volume means the market for most alts is extremely illiquid / non-existent: https://t.co/J6yLb5VxAx
— Yin Yin Wu (@yinyinwu) March 26, 2019
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